Capital has several important meanings that show up in different parts of life:

1. Money or resources used to start or grow a business. When an entrepreneur needs capital to open a bakery, she needs money for ovens, ingredients, and rent before selling a single cupcake. The word can also mean any valuable resource you can build on: your skills, your reputation, or your knowledge might be called human capital. Investors provide capital to businesses, hoping the business will succeed and earn them returns.
2. The city where a government is based. Washington, D.C., is the capital of the United States, where Congress meets and the President works. Each state has its own capital too: Sacramento for California, Austin for Texas, and so on. The capital is usually where important government decisions get made, though it's not always the largest city in its state or country.
3. An uppercase letter. When you write a sentence, the first word starts with a capital letter. Proper nouns, like names and places, also use capitals: Michael, Lake Superior, Tuesday. Some people call these “big letters” or “capital letters” to distinguish them from lowercase letters.